How to Start Selling Internationally

Conducting business globally has become an essential part of the overall strategy for many businesses. U.S. businesses sold $1.1 trillion in goods to customers overseas in 2007, nearly double the total export volume of 2002. But, sadly, less than 1 percent of the nation's 26 million small businesses are exporters, according to a Congressional committee on small business and entrepreneurship. Small businesses account for only 29 percent of all U.S. exporting volume -- a number lower today than it was 10 years ago.

The statistics are surprising because the ease of connectivity, transportation, and global product demand has reduced the barriers to entering markets overseas. With a few mouse clicks, you can buy a product today and never know it's coming from half way around the world. The opportunities to expand internationally are better than they ever have been before. International sales especially have never been easier, as the Internet and telecommunications have fostered quick and cheap global communications, more markets are open for trade, and more transportation options exist for delivering your goods abroad.

The following pages will outline how to choose overseas markets, assemble an international sales team or devise a strategy, and start selling abroad.

Choose Your Overseas Markets

The first step in expanding internationally is to pinpoint the country or region you want to expand into. You need to base these decisions largely on cultural, economic, political, and market risk -- and where there are potential customers for your goods and services. Selecting where to expand is easy with some time and research. Here are a few things to think about when deciding where to expand:

Determine international traffic or where orders are originating from on your website

Consider cultural and language differences

Understand the economic and political policy of the country or region

Find out whether there are any tariffs on your products or trade barriers

Most U.S. exporters now sell in only one overseas market -- Canada, for example, according to the U.S. Department of Commerce. The determining factor in whether a business exports to more than one country? Business size. About 60 percent of exporters with less than 19 employees on staff were selling goods or services in only one country, the department found. There are also opportunities in targeting a region, such as Central America, so that your business can take advantage of free trade agreements the U.S. is a party to, such as the Central America Free Trade Agreement (CAFTA).

Conduct market research

Your likelihood of success selling internationally will be increased depending upon how much market research you conduct beforehand. Market research can help you get a handle on where your goods or services will sell, the different market segments, whether you'll have competitors, and how to price your product for the market. Fortunately, there are many consultants, government agencies, books and free resources on the Internet that can help. On the Internet, you might start with the Commerce Department's Export Portal and with TradePort, a website that is a repository of information for businesses conducting trade from California.

The types of research you can do include primary market research -- collecting data directly from international marketplaces through telephone interviews or contacting potential customers or government representatives. The research can also include secondary market research, such as news articles, trade statistics, and data from export specialists.

Devise an Export Strategy

Your prospects of selling overseas will be helped if you put together an export plan that details your business goals, your plan for financing this expansion, and how you intend to sell your goods or services abroad. The Commerce Department has available a free webinar called Export University 101 that can help you develop this plan, devise a strategy, and make sure you comply with all U.S. and foreign government regulations. One of the key questions you need to ask is how you are going to sell your goods overseas. The options include: by establishing an international sales team or by selling over the Internet.

Assemble an international sales team

Building an international sales team can be achieved these days through partnerships, alliances, and direct hiring. Create a comprehensive list of companies in your industry, visit their websites, and reach out to their executive teams. You may find partnership opportunities here, in addition to creating alliances. Also review country-specific industry association websites and begin connecting with the leaders or executive boards of those organizations. Likewise, research industry-related trade shows and follow the same process of meeting the organizers and learning about your industry in that region. You may want to establish a Skype account to call internationally (from your computer) or find an overseas telecommunications provider at discounted prices. Nonetheless, it is vital to connect with the companies, associations, and people you have researched.

Aaron Bare, a serial entrepreneur, who has sold five businesses, including a global job board and a recruiting company, recommends the following tips to help you in your search for international sales help:

Search LinkedIn and other professional social networks to find contacts and ask questions in the country or region desired.

Find associations and people by doing a Google search within your industry and country.

Search the desired countries' biggest publications for relevant articles and the people behind the articles.

You may also want to research local executive recruiters, local and niche job boards, and the local newspapers to learn more about how talent in that particular region finds the best employers.

Bare also recommends visiting the country with a set agenda to conduct interviews with potential partners, meet with association leaders in your industry, and meet with the people you may hire.

Selling over the Internet

If you have a business, the odds are that you already have set up a shop online. Your website can be another international sales channel. The Internet has truly become the great equalizer in global sales. It's the place where Mom and Pop shops can compete with the Inc. 5000 and the Fortune 500 and more. There are two sales strategies that you can choose to follow over the Internet:

You can simply let the international customers find your website and shop just as your domestic customers already do. Using this method, you still need to figure out how to ship overseas and learn about foreign taxes, duties and customs laws. You might consider a payment system such as eBay's PayPal to help facilitate the acceptance of different currencies.

You can also actively find ways of using your website to target new foreign markets. This might include translating parts of your website into other languages. You can do this on the cheap with translation software or free Internet tools, such as Babel Fish. You can also spring for tech- or human-based translation services (see What Are You Trying to Say?). It may also be useful to employ someone fluent in the language of the foreign market you're trying to enter to use social networks to attract interest in your website, business, and products or services.

It's also important to understand the codes of conduct expected for electronic merchants in overseas markets. The U.S. and 28 other countries, working under the guise of the Organization for Economic Cooperation and Development, have developed new international guidelines, according to the U.S. Federal Trade Commission. These guidelines stipulate that firms doing business online internationally do the following:

Engage in fair business practices involving the presentation of "truthful, accurate and complete" information to consumers in terms of marketing and advertising.

Disclose information about the company and the products it offers so that international consumers know "whom they're dealing with and what they're buying." This includes address, e-mail address, and telephone number.

Be up front about the costs involved in the transaction (most importantly, the currency being used), as well as the terms and conditions of the sale, including any warranties and guarantees.

Provide a secure method for online payments to that personal financial information is not vulnerable to hackers.